NITDA Puts Value of Outsourcing Sector in Nigeria @ $285M

Kashifu Inuwa Abdullahi, director general, the National Information Technology Development Agency (NITDA) has put the worth of Business Process Outsourcing (BPO) ecosystem in the country at $285.8Million.

He stated this at stakeholder engagement forum organised by NITDA and Federal Inland Revenue Service in Lagos.

According to Inuwa, “today, Nigeria Outsourcing sector worth $285.8M employing 16,540 Nigerians mostly living in Nigeria and working for companies outside Nigeria.

“We started in 2020 with a strategy and engaged with the Business Process Outsourcing (BPO) to develop the strategy and some of them started operations in the mid of 2020 and we want to expand this because we believe the sector will create more jobs than any other sector in Nigeria”.

He chronicled ICT performance between 2019 and 2022 and noted that the sector has out-performed oil and gas in terms of contributions to Gross Domestic Product of the economy.

“If you compare ICT performance to lucrative sector oil and Gas. ICT has out-performed that sector looking at it from 2019 to 2022.

“In 2019 ICT contributed 13 per cent to our GDP while Oil and Gas 8.7 per cent. In 2020 ICT contributed 15% Oil and Gas 8.2%. in 2021 because of COVID 19 recession there was a bit decline ICT 14.11% while Oil and Gas 7.3% still with the recession ICT contributed almost twice of contributions from Oil and Gas. Last year ICT contributed 16.6% to our GDP while Oil and Gas contributed 6.4%.

Speaking on challenges of ICT development, Inuwa stated: “We have limited infrastructure because ICT also needs infrastructure the way we construct social infrastructure such as roads, rail way and Aviation infrastructure.

“We also need to construct infrastructure for ICT for the 4th industrial revolution which is ICT driven, we need to have infrastructure everywhere, we need to connect the unconnected so that they will be part of this digital economy. If you are digitally invisible Artificial intelligence will not consider you while making decision. We need to include everybody by doing more in terms of infrastructure built out.

“We cannot survive without corporate, because you provide the funding for us. Nigeria is ranked the most vibrant ICT ecosystem in Africa”.

He said Nigeria has an estimated 3,360 start-ups operating in the country as at December 2022 which is almost 5 times more than the second largest start-up ecosystem in Africa which is Kenya.

“Nigeria is home to 5 out of 7 unicorns in the continent – a unicorn is a start-up with valuation of more than $1billion.

“All these are not by accident; they are by design because of the policies government has put in place using the levy corporates pay to us to execute those policies and regulations,” he added.

The Executive Chairman, Federal Inland Revenue Service (FIRS), Muhammad Nami in his keynote address commended NITDA for the introduction of technology in the tax collection and payment processes which he noted has positively impacted on taxpayers and government’s ability to deliver social goods, critical infrastructure and other necessary services.

Mr. Nami who was represented by the Service’s Lead, General Tax Operations Group, Kabiru Abba, revealed that FIRS collected and remitted the sum of N22,574,099,600.06 in 2022, and the total sum collected  by FIRS  on behalf of the Agency from 2008 to December 2022 is N168,847,118,268.22.

He said it is important to showcase the achievements of NITDA, particularly as taxpayers can easily make a connection between the taxes paid and its socio-economic impact which will also assist to improve voluntary compliance.

“FIRS, for instance is continuously implementing initiatives which are principally driven by the use of Information Technology and many of such initiatives have been successfully implemented including the recently introduced Electronic Tax Clearance Certificate (ETCC),” he added.

Nami further noted that NITDA collection has also shown a significant improvement as the highest collection recorded thus far was in 2022 at N22,574,099,600.06, affirming that FIRS is a key partner of NITDA, and the Service assists in the assessment, collection and accounting for the Agency’s revenue, as stated in section 16 of the NITDA Act (2007).

He also assured NITDA of continuous support to achieve its mandate, emphasising that the support is important as IT plays a vital role in the operations of the service in ensuring increased revenue for the nation.